2021

2021 CPAB Disclosures public consultation

Jul 19, 2021

On July 19, 2021, the Canadian Public Accountability Board (CPAB) announced that they are conducting a public consultation to gather stakeholder input and to invite a dialogue on potential changes to the information that they disclose about the results of our regulatory assessments. Comments are requested by September 30, 2021.

CPAB is requesting input into potential changes to the information that they disclose about the results of their regulatory assessments, specifically:

  • Communication to audit committees
  • Disclosures of the results of our regulatory oversight activities
  • Disclosures related to CPAB’s enforcement actions

Review the press release on the CPAB's website.

A Year in Review: 2020 Audit Committee Forum Highlights

Apr 08, 2021

On April 8, 2021, the Canadian Public Accountability Board (CPAB) released highlights from their 12 forums held in 2020 for audit committee chairs and chief financial officers of Canadian reporting issuers to discuss the impact of COVID-19 on the financial reporting and audit quality in various industries, including real estate, mining, energy and financial institutions.

Review the audit committee forum highlights on the CPAB's website.

AASB Discussion Paper – Exploring Standard-Setting Options for Audits of Less Complex Entities

Sep 10, 2021

On September 10, 2021, the Auditing and Assurance Standards Board (AASB) issued a Discussion Paper to obtain stakeholder input on options that might be explored in Canada to address the challenge of applying the CASs to audits of less complex entities. Comments are requested by December 10, 2021.

Review the press release and Discussion Paper on the AASB's website.

AICPA’s proposed new quality management standards aim to enhance and maintain a CPA firm’s audit quality

Feb 04, 2021

On February 4, 2021, the American Institute of CPAs’ (AICPA) Auditing Standards Board (ASB) issued the exposure draft (ED), "Proposed Quality Management Standards", that includes three interrelated standards that address the way CPA firms manage quality for their accounting and auditing practices. The standards offer a new proactive, risk-based approach to effective quality management systems within CPA firms, which will improve the scalability of the standards and promote a system tailored to the firm and its engagements.

The ED aligns with the International Auditing and Assurance Standards Board’s (IAASB) quality management standards. The proposed standards include changes such as using the terms quality management and engagement quality review instead of quality control and engagement quality control review, respectively, used in the current standards.

The three proposed standards are:

  • Proposed Statement on Quality Management Standards (SQMS) A Firm’s System of Quality Management
  • Proposed SQMS Engagement Quality Reviews
  • Proposed Statement on Auditing Standards (SAS) Quality Management for an Engagement Conducted in Accordance with Generally Accepted Auditing Standards

Review the press release and exposure draft on the AICPA's website.

Appointments – AASOC and the AASB

Mar 18, 2021

On March 18, 2021, the Auditing and Assurance Standards Oversight Council (AASOC) and Auditing and Assurance Standards Board (AASB) announced new members and re-appointed members to the Council and the AASB.

Here are the new appointments from Deloitte Canada:

AASOC appointments

Appointed as a member for a three-year term ending on March 31, 2024:

  • Donald Newell, FCPA, FCA, ICD.D, B. Comm, Senior Partner (ret.), Deloitte LLP

Review the announcement on the AASB's website.

Assurance standards keeping pace on non-financial reporting

Mar 23, 2021

On March 23, 2021, the International Auditing and Assurance Standards Board (IAASB) published an article by Chair Tom Seidenstein, IAASB Chair, on how it supports the application of ISAE 3000 (Revised).

At its March 2021 meeting last week, the IAASB approved Non-Authoritative Guidance on Applying ISAE 3000 (Revised) to Extended External Reporting (EER) Assurance Engagements. This guidance marks a significant step forward in supporting the evolving field of assurance for non-financial reporting. To help stakeholders understand the role of both the guidance and ISAE 3000 (Revised), which is the IAASB’s authoritative pronouncement, IAASB Chair Tom Seidenstein published an article detailing the guidance and how it supports the application of ISAE 3000 (Revised), growing demands for non-financial information reporting and assurance thereon, and the IAASB’s ongoing commitment to the consistent performance of quality engagements. The guidance will be published in April.

Review the press release on the IAASB's website.

Audit committees “lose independence” the longer they serve

Sep 07, 2021

Study finds committees in troubled firms have fewer female members, more outside directorships, greater shareholdings and longer tenures.

As the UK moves towards reform of audit regulation there is now much research focused on the work of company directors overseeing the work of auditors. Not all of it comes with good news. A fresh examination of audit committees suggests those whose companies have been hit by scandals possess characteristics that some observers might call deficiencies.

Review the article on the Board Agenda's website.

Auditing accounting estimates: Strengthening audit quality

Sep 30, 2021

CPAB continues to find deficiencies and opportunities for improvement in the quality of audit work to support accounting estimates. This publication provides examples to clarify issues related to audit deficiencies in this area, as well as practices observed in files with no findings.

Review the publication on the CPAB's website.

Audits of Less Complex Entities Consultation: Supplemental guidance on auditor reporting & mapping documents published

Sep 03, 2021

On September 3, 2021, the International Auditing and Assurance Standards Board (IAASB) published new documents related to its open consultation on the audits of less complex entities.

The documents include:

  • Proposed supplemental guidance on auditor reporting to provide further guidance on modifications and other changes to the auditor’s report when using the proposed standard; and
  • “Mapping” documents to help users navigate between existing, equivalent International Standards on Auditing and the requirements in the newly proposed International Standard on Auditing for Less Complex Entities (ISA for LCE).

Review the press release on the IAASB's website.

CAQ Alert: Illegal Acts: The External Auditor’s Responsibilities

Jul 26, 2021

On July 26, 2021, the Center for Audit Quality (CAQ) released a resource, "Illegal Acts: The External Auditor’s Responsibilities", to educate users of financial statements on the auditor’s responsibilities in regards to illegal acts under PCAOB auditing standards and how they differ from the auditor’s responsibilities as it relates to fraud.

Recent global corporate fraud scandals such as those related to Wirecard in Germany and Carillion in the United Kingdom have driven a focus by capital market participants on the auditor’s role in identifying and detecting fraud. Certain audit regulators, including the International Auditing and Assurance Standards Board (IAASB) and the Public Company Accounting Oversight Board (PCAOB) have taken action with respect to fraud.

The publication provides an overview of the external auditor's responsibilities with respect to illegal acts and how they differ from fraud, outlining key differences and providing illustrative examples of each.

Review the publication on the CAQ's website.

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